Brian Walsh (Galway West, Independent)
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205. To ask the Minister for Finance his plans to amend the Central Bank regulations governing the type of employment and financial history required by lending institutions; if lending institutions will be allowed to accept employment and financial history from financial institutions outside of the State, the purpose being to allow returning emigrants apply for mortgages and not have to wait for six to 12 months; and if he will make a statement on the matter. [37086/14]

Michael Noonan (Limerick City, Fine Gael)
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At the outset, I must confirm to the Deputy that the lending institutions in Ireland, including those in which the State has a significant shareholding, are independent commercial entities. It is not appropriate for me, as Minister for Finance, to comment on or become involved in the detailed position of mortgage holders.

The decision on whether or not to grant a mortgage to a borrower must remain a commercial decision for the lending institution concerned. It is important that each lending institution is allowed to assess properly and independently the risks that it is considering when deciding whether or not to approve a mortgage. Mortgage lending must comply fully with the regulatory requirements, both in relation to the financial institution itself and also the safeguarding of the borrower's interests.

However, I have been informed by the Central Bank that Chapter 5 of the Central Bank of Ireland's Consumer Protection Code 2012 (the Code) contains provisions that require regulated entities to gather and record sufficient information from a consumer prior to offering, recommending, arranging or providing a mortgage. This information must include details of the consumer's personal circumstances employment status and financial situation including, where relevant: income, savings, financial products and other assets, and debts and financial commitments (among other things).

Provision 5.6 of the Code provides that, prior to providing a mortgage to a personal consumer, a mortgage lender must either have had sight of all original supporting documentation evidencing the personal consumer s identity and ability to repay, or receive from a mortgage intermediary a signed declaration that such mortgage intermediary has had sight of all original supporting documentation evidencing the personal consumer's identity and ability to repay. A declaration signed by the personal consumer, (or his or her representative), certifying income and/or ability to repay is not sufficient evidence for these purposes. 

Provision 5.7 of the Code provides that a regulated entity must assess the reasonableness of the information contained in the documentation submitted by a personal consumer in support of a mortgage application and take all reasonable steps to ensure that the documentation submitted is legitimate and authentic.

The Code also requires lenders to carry out an assessment of suitability to ascertain the personal consumer's likely ability to repay the debt, over the duration of the agreement.

The EU Mortgage Credit Directive on credit agreements for consumers relating to residential immovable property has been agreed and published. Article 18 of the Directive contains the obligation that Member States shall ensure that, before concluding a credit agreement that falls within the scope of the Directive, the creditor makes a thorough assessment of the consumer's creditworthiness. Work on the transposition of the Directive into national legislation has commenced. The above rules as they relate to the Directive will need to be reviewed as part of the transposition process. The Directive must be transposed by 21 March 2016.